While all the past three downturns have been either due to exposure of heightened external vulnerabilities or natural calamities, Centrum claimed, the ongoing slowdown seems to be "self inflicted".
The report said that the slowdown has been on account "of 3 successive shocks in 3 years in the form of demonetisation, rolling out of GST in not so phased manner coupled with the blowout of NBFC crisis".
In our study of the "downturns" in the last 20 years, the current slowdown seems to be the most protracted and severe both in terms of time and its spread. The impact on both rural and urban demand has been unprecedented," the report said.
Further it was noted that no downturn has reversed without the government intervention hence the September quarter of FY2020 may be the bottom and "we expect growth to rebound to normalized levels in Q1FY21-Q2FY21".
However the report also said that "though the worst seems to be behind us, this is going to be a slow ride towards path of normalization".
Centrum advised investors to move away from defensive portfolio and increase weightage to rate cyclicals like corporate banks, Auto etc.
"Therefore, we are underweight in both IT and Metals, neutral in Pharma and Telecom. Our top picks are a mix of value and rate cyclicals: SBI, L&T, Bajaj Auto, RNAM, Bajaj Consumer and NCC," the report added.
( With inputs from IANS )